TaxTMI 
TaxTMI 
2015 (11) TMI 1470
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....However, the appellant chose to pay duty @ 16% under protest and sought clarification from the Chief Commissioners office. Consequent to the clarification received from the Chief Commissioners office, they filed refund claim for excess duty paid of 4% under protest. The refund claim was rejected vide order-in-original No.27/04-05 dated 15.9.2004 by the then Assistant Commissioner holding that the claimant has not been able to prove that the burden of excise duty had not been passed on to the buyers. Aggrieved by the said order-in-original dated 15.9.2004, the appellant filed an appeal before the Commissioner (Appeals), which was rejected vide order-in-appeal No. AT/M-III/201/2005 dated 28.3.2005 holding that the incidence of duty has been passed on to the customers. Aggrieved by the said order dated 28.3.2005, the appellant preferred an appeal before the CESTAT. The CESTAT, vide order No. A/840/C-III/SMB/WZB/2006 dated 26.6.2006, remanded the matter to the original authority for deciding it afresh. In the second round of adjudication, the claim was once again rejected vide order-in-original No. 151(Refund)/06-07/AC dated 30.3.2007 by the Assistant Commissioner of Central Excise o....
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.... his case is identical to the case of ONGCs case wherein the common fact is that at initial stage, the excess duty was charged to the customer and subsequently credit note was issued and the customer had returned that amount back to the supplier. With this fact, though initially the amount of excess paid duty was recovered, but when the same was returned by the customer to the supplier, the status of non-passing of incidence of such duty was maintained. He submits that the amount of excess paid duty for which refund is sought for has been accounted for as receivable under the head of loan and advances in their balance sheet and on that basis only, the lower adjudicating authority has sanctioned the refund. Therefore, it is established that incidence of refund has not been passed on to any other person. In support of this submission, he placed reliance on various following judgments:- (i) CCE, Bangalore-I vs. Om Pharmaceuticals Ltd. reported in 2011 (268) ELT 79 (Kar.); (ii) Sudhir Papers Ltd. vs. CCE, Bangalore-I reported in 2012 (276) ELT 304 (Kar.); (iii) CCE, Mangalore-3 vs. Solaris Chemtech Ltd. reported in 2011 (273) ELT 191 (Kar.); (iv) CC....
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....lower authority verifying these facts and following the direction of the Commissioner (Appeals) given in the earlier order dated 5.2.2008 applying the ratio of the ONGC case (supra), sanctioned the refund. The Commissioner (Appeals) in his order dated 5.2.2008 recorded the following findings:- "I have gone through the records of the case. The impugned order passed by the Assistant Commissioner, Wagle I Dn., Mumbai-III, rejecting the appellants claim for refund was passed pursuant to the CESTAT Order No. A/840/C-III/SMB/WZB/2006 dated 26.6.2006 remanding the matter to the adjudicating authority for a fresh decision. The lower authority has observed that there is no evidence on record that the cenvat credit of the duty claimed as refundable has not been availed by the customer except for the appellants' contention and held that the appellants have not been able to establish that the duty burden has not been passed on to the buyers. He also observed that the burden to prove that the tax incidence has not been passed on to the buyers is on the claimant in view of the judgment of the Hon'ble Supreme Court in CCEx. V. Allied Photographics India Ltd. reported in 2004 (166) ELT 3....
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....above finding of the Hon'ble High Court, it is settled that it is not open for the Revenue to challenge the finding of the Commissioner (Appeals)'s order dated 5.2.2008 without filing any appeal against the same. Therefore, the impugned order of the Commissioner (Appeals) cannot be sustained. 7. Ongoing through the judgments cited by the rivals, I find that there are contrary judgments on this issue. However, in the case of Solaris Chemtech Ltd. (supra), the Hon'ble High Court of Karnataka held as under:- "5. From the material on record as well as the finding recorded by the two appellate authorities, it is clear that the excise duty has not been passed on to the customer. It is a case of mere adjustment of accounts by issue of credit note. Section 11B provides for refund of excise duty paid under the Act. In the circumstances, it is set out in proviso to sub-section (2) of Section 11B that when the excise duty paid by the manufacturer, if he had not passed on the incidence of such duty to any other person i.e., his customer, the duty paid is refundable. In the instant case, when the duty at a higher rate was paid by the manufacturer to the Department is not collected f....
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....The burden of proving the said fact is exclusively on assessee. It is only on discharge of the said burden the assessee would be entitled to the refund of the said amount. The finding of the CESTAT that the events subsequent to the clearance of the goods, raising of the invoice are relevant in deciding the question of refund of duty is not warranted from any of the statutory provisions. On the contrary, the basis for claim for refund is excess duty is to be paid at the time of clearance. As indicated in the invoice, it is only a subsequent event which makes that demand illegal, not warranted, not authorized and gives the assessee a right to seek for refund. In that context, if credit notes are raised and benefit is passed on to the customer, thus not passing on the burden of excise duty the assessee is entitled to refund of the same. Though the adjudicating authority or the appellate authority denied relief relying on the Judgment of the CESTAT in Addisons case, when that Judgment has been set aside by the Madras High Court, the Tribunal was in total error in following the Judgment and dismissing the appeal of the assessee. Merely because the matter is now pending before the Apex ....